The recent stronger-than-expected data means that a cut in interest rates at the Reserve Bank of Australia’s (RBA) policy meeting on Tuesday 5th May is no longer a done deal. But we still think the chances of a cut, to 2.00% from 2.25%, are greater than not. What’s more, even if the RBA stays on the sidelines again, a weakening in the economic data will probably prompt it to cut rates later in the year, perhaps even all the way to 1.5%.
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